Ethereum recently tumbled below a key support zone around $420 to $430 and hit a low of $344 before pausing from the drop. A correction might be underway and applying the Fibonacci retracement tool shows the potential pullback levels.

The 38.2% level is at the bottom of this area of interest and might be enough to keep gains in check in a shallow correction. The 50% level is around the top of this area of interest while the 61.8% level lines up with the moving averages’ dynamic inflection points.

The 100 SMA is below the longer-term 200 SMA to indicate that the path of least resistance is to the downside. This means that the selloff is more likely to resume than to reverse.

RSI is turning higher after dipping into oversold territory, which means that sellers could take a break and allow buyers to take over for the time being. Similarly stochastic is pointing up to show that buying pressure could return from here. Sellers might be waiting at the Fibs, ready to push ethereum back to the swing low or lower.

The recent tumble in cryptocurrencies is being pinned on the SEC announcement to delay their bitcoin ETF application decision for September. This could keep traders in limbo for much longer, and any updates suggesting that a denial is in order might further weigh on prices.

According to the SEC:

“Accordingly, the Commission … designates September 30, 2018, as the date by which the Commission shall either approve or disapprove, or institute proceedings to determine whether to disapprove, the proposed rule change.”

This has to do with the proposed rule change from the Cboe BZX Exchange that, if approved, would allow for the listing of an ETF backed by blockchain startup SolidX and investment firm VanEck. Other applications from firms ProShares, Direxion and GraniteShares, as well as other bitcoin-related funds are also being evaluated by the regulator.